“An opportunity to ‘back up the truck’ on this new HOT stock at a significantly reduced price.”

geothermal pick teased by Marin Katusa

By Travis Johnson, Stock Gumshoe, December 17, 2009

Today we’re looking at a newsletter from Doug Casey’s stable, the first one of his teasers that I’ve looked at in quite a while.

The pitch is that Marin Katusa has picked 19 consecutive winning stocks for his Casey’s Energy Report, and that you can subscribe now to get in on pick number 20, which is apparently getting close to their buy price.

As they put it …

“Marin’s just getting started. Winner #20 is already on his radar, and chances are it’s going to deliver even higher returns than any of the other 19.”

Katusa apparently has a “three-tiered formula” that helps him make money for subscribers — the first tier is a network of energy insiders that he cultivates, the second tier is some kind of mathematical valuation/screening “system” that helps him target buy prices, and the third tier is his team of energy analysts, who he naturally believes are “the best and brightest.”

I have no idea whether or not those “tiers” really mean anything or are just a marketing ploy, but I would imagine that they’re probably not lying about the 19 winners (though they may not count or credit them the way you would) — notice that we weren’t told that he’s had 19 picks that beat the market, just 19 “winners,” which the little footnote indicates were all chosen in the last quarter of 2008 and the first eight months of 2009, so it’s possible that even picking 19 “winners” in a row could have your overall portfolio trailing the S&P 500. Not to throw cold water on the claim, I certainly haven’t ever picked 19 winners in a row, but we might also argue that every hot streak has to end at some point.

I didn’t receive the email ad for this one directly, I just got the link sent along to me recently, so I can’t tell you for sure when the ad started running — which means it’s possible that this “number 20” pick has already been made.

So, with those caveats, what is this stock that’s Marin Katusa’s possible 20th consecutive hot pick? You may or may not be delighted to hear that it’s a geothermal stock … a sector we’ve looked at many times in the last couple years, but which one?

“Winner #20 is a geothermal company. And geothermal energy is not only one of the most reliable alternative energies — it will be one of the most profitable, as President Obama continues to pump money into the green sector through subsidies.

“The man behind this company is a legend in the resource sector for his financial insight. It’s no wonder he’s been dubbed the ‘broken slot machine’ for his unrivaled ability to make shareholders money.”

OK, so that’s actually maybe enough for us to identify this stock … but we get a few more clues, let’s use ’em …

“Recently, winner #20 filed its IPO (initial public offering), and investors as well as industry insiders clamored to get a piece of the action.

“As often happens with IPOs, this frenzied buying quickly inflated and then deflated the stock price, which for now has returned to a more realistic level. During the imminent market decline, Marin believes all stocks will suffer a temporary setback, creating a tremendous buying opportunity.

“An opportunity to ‘back up the truck’ on this new hot stock at a significantly reduced price.”

And as every good copywriter knows, throwing in some quotes from well-respected news organizations makes your deal look more substantive, and quiets the voice in the readers head that says, “what if this is all just a scam?”

So yes, we get a few press quotes, too:

“‘Investors around the world are leaping on the initial public offering of [this] Canadian geothermal energy company, highlighting the soaring interest in the geothermal space and the superb track record of [the company’s] founder.’ -Reuters”


“[This geothermal stock] ‘is definitely one of the hottest deals of the year.’ -The National Post”


“Geothermal is one of the great answers to our energy crisis. Add the facts that: [1] you’re not exposed to commodity prices, [2] you’re not exposed to the dictators of the world, and [3] you’re not throwing away your domestic product to foreigners. It’s just a great, great business. -IBT Commodities”


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“‘President Barack Obama’s American Recovery and Reinvestment Act provides tax credits for geothermal projects, and the American Clean Energy and Security Act is laden with more incentives for clean energy investment.’ -The Financial Post”

If you’ve been around these parts for a while you’re probably familiar with the concept of geothermal energy — drilling into hot zones, pumping in water, using that heated water to create steam that powers turbines and generate electricity, it’s been proven as a concept for years, at least in hot zones like Iceland and The Geysers in Northern California. Geothermal generation is certainly a lot more “green” than burning coal or natural gas, and provides baseload (“always on”) energy unlike sun-dependent solar or wind-dependent turbines, though it also comes with complications (not least that it can be expensive to drill and develop, and for best results you need a very hot area, and the process is pretty tough on the equipment), so I’ll spare you the rest of Katusa’s general argument in favor of geothermal energy.

This last bit, then reiterates the importance of the man behind the company:

“When asked about winner #20, ‘Vancouver’s mining maven’ had this to say:

“‘The object is to do the same thing we did [with my silver producer]: to build the biggest geothermal energy business in the world.’

“We have every confidence he will do it.

“Indeed, the long-term profit potential is staggering.

“That’s why Marin and the whole Casey team are on board with winner #20.”

So who is this e